Significant work remains for the Senate if it is to pass President Biden’s nearly $2 trillion spending package before the winter holidays, according to Bloomberg (subscription).
Victory needed: “A delay into the new year risks slowing momentum for Democrats who need this legislative victory behind them as they fight to maintain narrow majorities in the House and Senate in the 2022 midterm elections. The signature bill includes spending on Democratic priorities such as child care and climate change and drastically changes the tax cuts Republicans won under President Donald Trump.”
- Democrats require the support of all 50 members of their caucus to push the legislation through the Senate, but Sens. Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ) have not signed on.
Under negotiation: Still being debated are a House-passed provision for four weeks of paid family and medical leave and an expansion of state and local tax deduction (SALT), which is currently capped at $10,000.
“Book” tax: Democrats are also considering “tweaking the 15% corporate minimum levy on financial profits, known as the minimum ‘book’ tax.”
- The NAM opposes this tax, which would significantly raise taxes and penalize manufacturers.
Union-made EVs up in the air: A tax credit for union-produced electric vehicles could face changes, too. The legislation includes a $4,500 tax credit for consumers who buy U.S.-made, union-assembled EVs. That incentive is on top of a $7,500 credit available to most EV buyers.
Senate Parliamentarian weighs in: Senate Parliamentarian Elizabeth MacDonough, who last month heard arguments from both Democrats and Republicans about whether the legislation could include a plan to prevent up to 6.5 million undocumented immigrants from being deported, is still required to hear arguments on the rest of the package.
The NAM’s take: “Regardless of its intentions, this legislation is paid for by tax increases that will hurt manufacturers. The ‘book tax’ in particular will hurt manufacturers’ competitiveness, and the drug pricing provisions in this bill will limit pharmaceutical manufacturers’ ability to innovate and find new cures,” said NAM Vice President of Government Relations Jordan Stoick. “As Democratic leaders on Capitol Hill work toward a potential vote in the Senate this year, we continue to push back on these harmful policies and are urging senators to oppose this bill.”